Kenecott Utah Copper Corp v Cornhill Insurance Plc & Ors [1999] EWHC 288 (Comm) (12 October 1999)

Kenecott Utah Copper Corp v Cornhill Insurance Plc & Ors [1999] EWHC 288 (Comm) (12 October 1999)

Attachment of the FCF and Acid Plant to the operational policy/reinsurance depends on whether they were installed and completely tested as defined by Property Exclusion 15 and Clause 9(b). The court finds that neither plant had undergone contractual performance tests at the dates of the incidents, and thus had not achieved the status required for attachment under the policy wording. Misrepresentation/non-disclosure issues are contingent on this finding. The claims under the operational policy/reinsurance are not established for the FCF and Acid Plant as they had not been completely tested and handed over as required.

Citation
[1999] EWHC 288 (Comm)
Parties
First Claimant: Kennecott Utah Copper Corporation (KUCC); Second Claimant: Kennecott; Third Claimant: TCI; Fourth Claimant: RTZ; First Defendant (reinsurer): Allianz Cornhill; Second Defendant (reinsurer): Swiss Re; Third Defendant (reinsurer): Scor; Fourth Defendant (reinsurer): Cigna; Fifth Defendant (reinsurer): CTR; Sixth Defendant (reinsurer): Abeille; Thirteenth Defendant (broker): Minets
Jurisdiction
England and Wales
Judgment Date
12 October 1999
Procedural Posture
Commercial Insurance/reinsurance Dispute / Trial of Preliminary Issues
Outcome
Claims under operational policy/reinsurance for FCF and Acid Plant not established.
Legal Topics
Reinsurance Contract Interpretation, Attachment of Risk, Misrepresentation and Non Disclosure, Broker Authority, Policy Exclusions
Insurance Law Contract Law Reinsurance Contract Interpretation Attachment of Risk Misrepresentation and Non Disclosure Broker Authority Policy Exclusions

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Parties

Kennecott Utah Copper Corporation (KUCC)

First Claimant

Kennecott

Second Claimant

TCI

Third Claimant

RTZ

Fourth Claimant

Allianz Cornhill

First Defendant (reinsurer)

Swiss Re

Second Defendant (reinsurer)

Scor

Third Defendant (reinsurer)

Cigna

Fourth Defendant (reinsurer)

CTR

Fifth Defendant (reinsurer)

Abeille

Sixth Defendant (reinsurer)

Minets

Thirteenth Defendant (broker)

Procedural Posture

Commercial Insurance/reinsurance Dispute / Trial of Preliminary Issues

Legal Issues

  1. 1 Whether the FCF and Acid Plant attached to the operational policy/reinsurance at the time of the incidents
  2. 2 Effect of policy wording and endorsements on attachment
  3. 3 Whether reinsurers are entitled to avoid certain endorsements for misrepresentation/non-disclosure

Ratio Decidendi

Attachment of the FCF and Acid Plant to the operational policy/reinsurance depends on whether they were installed and completely tested as defined by Property Exclusion 15 and Clause 9(b). The court finds that neither plant had undergone contractual performance tests at the dates of the incidents, and thus had not achieved the status required for attachment under the policy wording. Misrepresentation/non-disclosure issues are contingent on this finding. The claims under the operational policy/reinsurance are not established for the FCF and Acid Plant as they had not been completely tested and handed over as required.

Court Disposition

Claims under operational policy/reinsurance for FCF and Acid Plant not established.

Orders

  • Claims against reinsurers dismissed as to FCF and Acid Plant under operational policy/reinsurance.
  • Alternative claim against Minets contingent on failure of claim against reinsurers.